Instead of war, how about...

A friend of mine, Tom Digby, once proposed that instead of going to war over disputes, countries could field football teams, and the results of the game would determine the winner. (In practice, I think the losing side would start a shooting war.)

Steve Sailer has a solution for disputed border territories.

On the other hand, if it's assumed something has to be done about a disputed territory, the optimal way to settle it is often via a mutual auction. If both Russia and Georgia want South Ossetia, they should put their money where there mouths are. Auction off South Ossetia with the highest bidder paying that sum to the loser of the auction.

In a way, of course, war is an auction. Each side imposes costs on the other, in terms of casualties, destruction, and suffering, until one side or the other drops out of the bidding. Sailer's proposition would have the auctions limited to the payments of goods, rather than the infliction of bads. But what mechanism would there be to keep the bidding parties from throwing bads into the mix? If one side says, "if you outbid us, we'll bomb your factories," there must be some mechanism to impose a cost that makes taking that step very much not worth it.

We like to say war should be the last resort. Practically speaking, war is always the last resort, even if only because no one's come up with anything worse.